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Thanks To Truphone, Mobile VoIP Prices Falling Fast

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Truphone, a London-based mobile VoIP startup, tomorrow is expected to introduce a flat-rate plan (TruUnlimited for Landlines) that would allow its customers unlimited calls to landlines in 38 countries for just over $14 a month. In some countries — the U.S., Canada, China and Hong Kong, for example — the plan would also allow unlimited calls to mobile phones as well. Truphone is also offering another plan (TruUnlimited for Mobiles) that would allow unlimited calls to mobiles and landlines in 64 countries for about $35 a month. With Skype for iPhone (and iPod) likely to be introduced later this week, this seems to be a pre-emptive move by Truphone.

In a previous post, I noted that the iPhone had turbocharged Truphone’s growth. Skype threatens to take some of that sizzle away. Skype’s entry into mobile VoIP will give everyone a heartache. Truphone and Nimbuzz are betting that by being über-communication clients, they can continue to thrive.

If the reaction to my post about Skype’s debut on iPhone is any indication, the world’s largest international voice service is going to become a major player in mobile VoIP pretty quickly. I’m pretty likely to switch to Skype, mostly because my SkypeIn number has a local number — a service Truphone doesn’t offer just yet.

BlackBerry owners in the U.S. will be happy to hear that Truphone is finally releasing Truphone Business, a BlackBerry application enabling business users to make international phone calls from their devices at wireline rates. You download the application. It works in the background. The minute you dial a number that’s international, Truphone intercepts the call and connects it to the international destination via the Truphone network. This doesn’t need Wi-Fi, unlike Truphone on Nokia and iPhone.

Having been an ardent fan of mobile VoIP startups (including Truphone), I am beginning to worry about the company now. We have seen this movie before — low prices, flat-rate pricing and price wars were all strategies used by desperate broadband voice startups that burned through millions of dollars in venture funding. Will history will repeat itself?

11 Responses to “Thanks To Truphone, Mobile VoIP Prices Falling Fast”

  1. I signed up for Truphone 3-4 days ago with their unlimited plan, and within three days of their launch they have decided to halt their unlimited service. When you call their customer service:US: 1 347 694 5000, they say that they are having some issues with the unlimited service and that some users are abusing it and whatsoever. Their terms says that they consider 3000 minutes to be reasonable allowance, however, I think they have generalized as I have personally made only about 100 minutes worth of calls. Without any prior notification, they not stopped providing service, they instead put me on the standard pay per min plan, unbeknownst to me I kept making calls and kept losing money until this morning. When I called, they said they are going to have some directors meeting come tuesday after easter to decide on the plan.
    This is nothing but a big disaster for truphone.
    Truphone tried to launch big in US, however, they have failed to deliver their product in the first few days.
    Do not Sign Up!!
    Bad Bad Bad company and service!!

    • Yes, it looks like it’s been dropped. That’s annoying. Maybe it was just a cheap way of geting some publicity (which will backfire!).

      >>hey instead put me on the standard pay per min plan<<

      Demand a refund.

  2. @ABC, IMHO, it’s the label “VoIP” that’s the major problem, not the products being built using VoIP, which do a whole lot more than lower the entry barrier for upstarts to introduce competitive pricing structures for placing telephone calls.

    The acronym is a total, unmitigated disaster for anyone entering this space…. “VoIP” isn’t even a product or a market that anyone can define without massive contradictions.

    Just about every cellular phone call placed today traverses a VoIP gateway somewhere, so it’s easy to get really confused when terms like “Mobile VoIP” are tossed around in the context of trying to describe a new product.

  3. Will history repeat itself? Most certainly it will. When the customer value proposition is based on making something cheaper, then competitors compete by making it cheaper still, and you get a race to the bottom. Great for the customer, not so great for the companies. VoIP’s future is about the new things you’ll be able to do, not doing the same old things for less money. We are in the early stages of this, so some companies believe there is a business providing a single feature, like PhoneTag and Jott, but they are the equivalent of, say, a company that offered voicemail as a separate for pay service 10 years ago. Cheap voice is like that as well – it’s a temporary opportunity created during a transition from legacy PSTN to VoIP. Eventually cheap voice with cool features will be the standard, and the winners in the space will be companies that can provide everything in a single package that is simple to set up, easy-to-use, reliable, and comes with great customer support.

    • VOIP value proposition never gone beyond cheap calls. There were lots of promises with IMS n all related to services but all super flop so far. May be LTE changes a game where operator needs IP infrastructure.

    • charlie

      Truphone does have a good VM system. I keep a truphone number for that reason alone when travelling. Forward my domestic mobile calls to the Truphone number, and either answer them while overseas/wifi range or let them go to the email delivered truphone VM system. Excellent value.

  4. very interested in this ‘truunlimited for mobiles.’ how can they afford to offer free unlimited calls to mobile in all those contries? i am guessing it will have a very limited use FUP.

  5. charlie

    Six months too late on Truphone’s part. Using a Nokia and a VOIPBUSTER client for 30 euros a year unlimited calling to the developed world. I know Truphone can’t compete on price, and they aren’t expanding any service. Maybe for 5 to 10 a month, not 14.

  6. Skype has a 20-mile head start in the marathon transition from circuit-switched pricing models to super-cheap voice communications. But I still have this feeling that they’ll lose the race.

    2 years ago I never thought I would need another VOIP service other than Skype. Then RingCentral offered better messaging and call control. Now Google Voice integrates SMS and lets me make calls from any device, not just special Skype devices. What real progress has Skype made in the last couple of years? An iPhone app? Come on.